UPDATE (12/23/2008): More than a year after posting the below, I'm still a happy user of FreshBooks. Gets the job done, is nice & simple, and gets out of my way.
When I set out on my own again, especially once the consulting gigs started to really pick up, I needed a solution to handle invoicing, time tracking, and accounts receivable management. In the past, I'd known myself to procrastinate (gasp!) generating invoices.
The procrastination was really the symptom of something else: I'd never really taken the time to automate the process. I'd started off on the wrong foot to begin with. I was tracking minutes in text files, adding them up manually, etc. Further, even if I'd used a fancy system to track and generate the invoices, I have this apparent aversion to addressing, stamping, and walking to the mailbox. Guess I'm just lazy.
So, a bit back, I spent a few hours seeing what was out there these days. Ultimately I settled on three (hosted Web 2.0-ish, if you will) solutions as the major candidates that met my needs:
After getting test accounts with each of them I ultimately went with FreshBooks. The main thing that did it for me was that FreshBooks allowed me to send paper invoices without actually touching a stamp, envelope, or printing anything. Yep, they mail it for me and even include the return envelope with my address!
I do actually send all of my clients e-mail invoices -- since that has become much more acceptable these days -- avoiding hard copy whenever possible. However I like having the option and it can also be handy when someone is taking their time paying..
Technically, FreshBooks doesn't e-mail the invoices but sends out an e-mail with a URL that contains the invoice. While others include the invoice in the actual e-mail, I have found it nifty that FreshBooks' approach allows me to see who has viewed their invoice (and they even provide an RSS activity feed to track client invoice reads!).
Since going with FreshBooks, all three billing solutions have added plenty of functionality. And Cashboard, which was in beta when I first looked at it, is now out of beta. I may re-look at each of them at a later date, but I really am pretty satisfied with FreshBooks for the moment.
If you suspect you spend too much time on invoicing, take a look at what's out there these days!